Which of the Following Statements Is True with Regard to Depreciation

question 62

Multiple Choice

Which of the following statements is true with regard to depreciation expense?

• A)Different companies in the same industry always depreciate similar assets by the same methods.
• B)A company using straight line will show a smaller book value for assets than if the same company uses double declining balance.
• C)Choosing double declining balance over straight line will produce a greater total depreciation expense over the asset's life.
• D)A company should use the depreciation method that best matches expense recognition with the use of the asset.

Recognize the value of managing diversity and affirmative action in creating more equitable workplaces.

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Definitions:

Short-Term Notes Payable

Liabilities representing amounts borrowed that are expected to be repaid within one year or one operating cycle, whichever is longer.

Accruals

Accounting method where revenue and expenses are recorded when earned or incurred, regardless of when the cash transaction occurs.

Quick Ratio

A financial metric that measures a company's ability to cover its short-term liabilities with its most liquid assets, excluding inventory.

Accounts Receivable

Accounts receivable are amounts owed to a business by its customers for goods or services delivered but not yet paid for.